Rex Energy (REXX) Stock: Struggling to Stay in the Green

Rex Energy Corporation (NASDAQ: REXX)

Rex Energy Corporation looked like it was going to have an incredibly strong day in the market early on today. However, as we looked across the oil and energy sector, things started to look grim. Across the sector, things were turning darker and darker red. Nonetheless, REXX has fought to stay in the green. Below, we’ll talk about why the oil and energy sector is taking a hit today, what we’re seeing from REXX, and what investors should be watching ahead.

Why REXX And Others In The Industry Are Falling

To understand why Rex Energy and others in the oil and energy sector are having a hard time, it’s important to understand why the stocks have been climbing. Months ago, OPEC reached what they called an agreement to reduce oil production. However, the agreement wasn’t much of an agreement. At the end of the day, none of the parties of the agreement agreed to anything except for the fact that they would agree to something later on. So naturally, the agreement was met with skepticism.

Nonetheless, OPEC said that they expected that the final agreement would be finalized by November 30th. Ultimately, this was met with more questions than answers. Nonetheless, when the 30th rolled around, we saw that an agreement was indeed finalized. Last week, OPEC agreed to cut production by about 1 million barrels of oil per day.

Of course, this was great news for REXX and any other company that makes its money with oil. After all, with OPEC cutting production, the law of supply and demand says that the value of oil must climb; and climb it did. For the last several trading sessions, the value of oil has been running to highs and stocks in the sector have been following suit…

Until Today Anyway!

Today, the entire oil and energy sector seems to be seeing red. At the end of the day, while this may be concerning, there’s nothing to be concerned about here. The reality is that the market tends to move through a series of overreactions. We tend to see big gains, followed by big losses. With such strong gains over the past several trading sessions, it was time for a correction, bringing things back down to a more sustainable rate before growth can continue.

What We’re Seeing From REXX

For the most part, Rex Energy is one of the lucky few in the sector that are having a great day. The stock started the day off well into the green, and while it has fallen a bit, it has struggled hard and stayed above the line. At the moment (2:32), REXX is trading at $0.58 per share after a gain of $0.01 per share or 2.18% thus far today.

What To Watch Ahead

Moving forward, investors should keep a close eye on supply and demand data. At the end of the day, Rex Energy gets it’s value from oi. If supply and demand continue to dictate that the price of oil will rise, so too will the stock. However, don’t be fooled. The OPEC agreement to cut production is a drop in the bucket when compared to the current supply glut. So, we may be surprised with what the supply and demand data tells us ahead!

What Do You Think?

Where do you think REXX is headed moving forward? Join the discussion in the comments below!